My previous BTC/USD signal on 24th May produced a very profitable long trade from the bullish rejection of the support level which I had identified at $26,003.
Today’s BTC/USD Signals
Risk 0.50% per trade.
Trades must be taken prior to 5pm Tokyo time Wednesday.
Long Trade Ideas
- Long entry after a bullish price action reversal on the H1 timeframe following the next touch of $27,476, $27,230, or $26,687.
- Place the stop loss $100 below the local swing low.
- Adjust the stop loss to break even once the trade is $100 in profit by price.
- Remove 50% of the position as profit when the trade is $100 in profit by price and leave the remainder of the position to run.
Short Trade Ideas
- Short entry after a bearish price action reversal on the H1 timeframe following the next touch of $27,862, $28,070, or $28,331.
- Place the stop loss $100 above the local swing high.
- Adjust the stop loss to break even once the trade is $100 in profit by price.
- Remove 50% of the position as profit when the trade is $100 in profit by price and leave the remainder of the position to run.
The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.
BTC/USD Analysis
I wrote in my previous BTC/USD analysis on 24th May that the price was contained within a wide, long-term bearish price channel and the supportive area below $27k looked ready to break down.
I was looking to take a short trade following two consecutive lower hourly closes below $26,591.
This was a good short-term call as the price did make this breakdown, falling to well below the $26k handle over the day, although the price bounced back and put in a low there from where it has risen since.
The price continued to rise and reached very close to the upper trend line of the wide descending price channel which has been the dominant long-term technical chart pattern here, making a strong bearish reversal by rejecting the resistance level at $28,331. The price has continued to act bearishly since then, especially by printing new lower stairstep resistance at $27,862 which seems to be suppressing the price this morning.
As we are near the top of a large bearish price channel, I am ready to look for short trades from any bearish reversal we might get today at any of the resistance levels identified above. Another factor reinforcing this for me is the continuing relative strength of the US Dollar.
Concerning the US Dollar, there will be a release of FOMC Meeting Minutes at 7pm London time.
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